Mental health provider billed state more than $152G for booze, cruise, other improper costs, audit finds

A mental health provider billed the state for alcohol and a sunset cruise at the Montauk Yacht Club Resort and Marina as part of $152,680 in improper costs charged to the state, according to an audit released last week by state Comptroller Thomas DiNapoli.

PSCH Inc., a Flushing-based nonprofit that serves Long Island, New York City and Westchester County, will have to pay the state back for the unsubstantiated or unallowable charges, the comptroller's office said.

"The rules for conference costs are clear," DiNapoli said in a news release. "And lavish parties with alcohol, cruises and extra guests are not allowable. State agencies must make sure that contractors are reimbursed for legitimate expenses only."

Over two days in October 2012 during the Montauk getaway, the board of directors and executive staff racked up $31,908 in disallowed charges. That included a $10,723 alcohol tab, $1,000 for a sunset cruise, $5,064 for extra guests and $743 for gift candles.

PSCH also charged the state $22,901 for a staff picnic at Cunningham Park in Queens, which included $1,300 for ice cream and $3,420 in "staff appreciation giveaways" such as coolers, T-shirts, pens and umbrellas, according to the audit.

PSCH vice president of public affairs Willie Scott did not dispute the audit's findings.

"We have implemented the recommendations," he said in an interview on Wednesday. The audit recommendations include reimbursing the state and training for nonprofit staff on allowable expenses.

PSCH has a $30 million, five-year contract with the state's Office of Mental Health to provide services and housing to people with mental disabilities and substance abuse.